HRA

HRA

Health Reimbursement Arrangement

 

The HRA or Health Reimbursement Arrangement is an employer-sponsored plan to reimburse a portion of your and your eligible family member’s out-of-pocket medical expenses, such as deductibles, coinsurance, and pharmacy expenses.

An HRA is not an account. Employees cannot withdraw funds in advance and then use them to pay medical expenses. An HRA is a type of account that employers offer to employees in order to help them save for healthcare expenses. It is not a bank account, and the funds cannot be withdrawn from the employer’s HRA. Employees can only withdraw money when they are paying for qualified medical expenses such as copays, hospital payments, blood pressure monitor, over the counter drugs and prescription drugs.

Contributions

There is no federal limit on the amount employers may contribute to an employee’s group health plan HRA. When setting up the benefit, employers must establish a maximum HRA amount that would be made available to individuals, sometimes referred to by the IRS as a reimbursement limit Your employer has designated a specific dollar amount to credit to the account (either monthly or annual contributions). You choose which out-of-pocket qualified medical expenses you would like to submit for reimbursement.

Unused Balances

Unused account balances roll over to the following plan year, provided your employer continues to offer the program, and you remain enrolled. For certain types of HRAs, you (and possibly other household members) must be enrolled in a health plan to use the money. 

HRA Administration Includes:

Plan Documents

Outlining plan’s participants and beneficiaries, and guides the plan sponsor and plan administrator in making decisions and executing their responsibilities.

Notice to Employees

Guidance on the notice to employees of coverage options under FLSA.

Summary Plan Description (SPD)

Document outlining the most important facts employees need to know about their retirement and health benefit plans including plan rules, financial information, and management of the plan.

Board Resolution & Adoption Agreement

Document verifying unanimous consent from the Board of Directors.

Reimbursement & Enrollment Form

Membership forms.

QSEHRA & ICHRA Plan Administration

 

HRA providers need to stay in compliance with third-party benefits administrators. Third-party administrators provide daily administrative tasks and help ensure your account stays compliant with federal, state and local regulations. We offer everything needed to set up Qualified Small Employer Health Reimbursement Arrangement, Qualified Small Employer Health Reimbursement Arrangement (QSEHRA), and Individual Coverage Health Reimbursement Arrangement (ICHRA) are included within our services.  A Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) is an HRA for smaller companies that have less than 50 full-time workers while an Individual Coverage (ICHRA) allows employees to buy their own individual health insurance with pretax dollars.  

QSEHRAs are subject to an annual employer contribution limit. In 2022, reimbursements from a QSEHRA cannot exceed $5,450 per year for self-only coverage or $11,050 per year for coverage that includes family members.  For 2023, the maximum amount of payments and reimbursements under a QSEHRA will be $5,850 for self-only coverage and $11,800 for family coverage.

These dollar amounts are prorated for part-year employees and part-year QSEHRAs and are indexed for inflation in future years. Employers may choose to provide a QSEHRA with a reimbursement limit below these specified amounts. In addition, employers that continue to offer traditional group health insurance can offer Excepted Benefit HRAs (EBHRA) to reimburse employees for up to $1,800 a year in qualified medical expenses. For plan years beginning in 2023, the maximum amount that may be made newly available for the plan year for an excepted benefit HRA is $1,950.”

Our Services

  • Each new client will have a one-on-one consultation with a knowledgeable representative to ensure the proposed HRA is as simple, efficient, and valuable to the participants as possible.
  • A variety of features are available; we will fully utilize the capabilities of its systems to accommodate as many options as possible.
  • The Qualified Small Employer Health Reimbursement Arrangement (QSEHRA), which allows for the reimbursement of health insurance premiums along with medical expenses is an option for employers with less than 50 employees.
    We will teach employers how to navigate through the ever-changing regulations surrounding these benefits (Affordable Care Act, Tax Cuts and Jobs Act, etc.).
  • We are dedicated to only operating compliant plan designs.
  • The benefit card will be an option for certain designs. 
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